Sweden

As a member of the European Union and Annex-1 party to the Kyoto Protocol, Sweden’s approach to climate change is predominantly influenced by the commitment to implement international emission reduction targets and corresponding legislation from the EU, which focuses on achieving an overall emission reduction target, a target for renewable energy and improving energy efficiency. The Government introduced no specific legislation to implement the Kyoto Protocol. Instead, different government departments, regions and municipalities implemented the commitments under the Kyoto Protocol via policies, programmes and action plans.

Sweden’s approach to climate change is primarily grounded in market-based initiatives that cut across different sectors, integrating climate mitigation via price signals across industries. The climate strategy emphasises economic policy instruments, supplemented with targeted initiatives such as financial support for technological innovation and the introduction of new technologies into the market.

The Environmental Protection Agency, within the Ministry of Environment, is the lead government body responsible for implementing climate change and environmental policies in the country. In addition to UNFCCC reporting, the Environmental Protection Agency ensures the annual release of emissions statistics and tracking data. The Swedish Meteorological and Hydrological Institute is also responsible for collating and disseminating climate change information while the Swedish Energy Agency, within the Ministry of Enterprise, Energy and Communications, annually reviews energy and climate advice services and the impact of such services on kilowatt-hours saved. Both the Swedish Forest Agency and the Swedish Board of Agriculture similarly engage in climate change policy implementation and information dissemination.

The municipalities also play a crucial role in meeting international climate mitigation commitments as they formulate and implement plans for policy measures in all areas including energy management, land use, waste and transportation. Sub-national activity is co-ordinated by the central government, which implements climate legislation mandated by the Parliament. Sub-national activities also include involving citizens in local decision-making and raising public awareness regarding climate change and Sweden’s policy frameworks to encourage citizens to conserve energy and invest in renewables.

Energy supply

According to Sweden’s Sixth National Communication (2014), the composition of energy supply has changed markedly since 1970, when crude oil accounted for more than 75% of the energy mix. Crude oil has now been largely replaced by nuclear power and biofuels: in 2012, oil was 21.5% of the energy mix. Nearly 40% of all petroleum products have been replaced by non-fossil energy sources. By 2010 the share of renewable energy increased to 48% of energy use, meaning Sweden is well on its way to achieving 50% renewables by 2020.

In 2011, hydropower accounted for 45% of electricity production, nuclear power made up 40%, wind power 4%, and fossil fuels and biofuels accounted for the remaining 11%.

Several energy-related policies encourage emission reduction in the energy supply sector: the 2003 Electricity Certificates Act represents a quota system, requiring energy suppliers to purchase certificates corresponding to a certain percentage of their electricity sales, subsidies for photovoltaic installations and tax regulation mechanisms such as reductions in the energy/carbon tax for biofuels.  In 2009, the provisions of this Act were extended until the end of 2035.

Emission reductions in the energy supply sector are seen as a result of the EU ETS, energy and carbon taxes, the electricity certificate system, special support for wind power and targeted energy efficiency measures. Estimates project a business-as-usual surplus of emissions of 15m tonnes in 2007 had the energy supply policies of 1990 been retained. This indicates that emissions (excluding LULUCF) would be about 25-30% higher without the existing policy measures in place, mainly because the profitability of coal would have been high enough to crowd out lower emission energy sources. The tightening of appropriate policy instruments is the key explanation for the avoided emissions.

Energy demand

Sweden has a large electricity demand per capita at an average of 15,000kWh per person/year. Industry makes up the largest share of this demand at 39.3%, followed by transportation (24.1%), residential (22.5%), and commercial, public services and agriculture (14.1%). The Swedish Energy Agency has the broad authority to outline and implement plans of action for increased energy efficiency and renewable energy use to offset this demand.

In 2005, Sweden began an industrial energy efficiency programme that engaged with about 180 power-intensive industries and granted tax-relief for the establishment and implementation of plans for reduced energy use. It yielded energy savings of approximately 1.45TWh per year, according to the Swedish Energy Agency, Although the programme ended in 2009, a new one was re-initiated to engage with 90 power-intensive industries that on aggregate account for a fifth of total electricity consumption.

In 2009, following from the Integrated Climate and Energy Policy bills (2008), Sweden began a comprehensive five-year energy efficiency programme for 2010-2014. Aimed at increasing regional and local climate and energy initiatives, this programme encouraged businesses to audit their energy consumption and to invest in energy efficient technologies.

Energy use was also impacted by grants, the expansion of and connection to district heating, energy efficiency building requirements and EU legislation. In particular, the Eco-design Directive, the Energy Labelling Directive and the Energy Performance of Buildings Directive had a positive impact on avoiding and reducing emissions.

Carbon and energy taxes similarly play a significant role in reducing energy demand via price signals that raise the cost of carbon-intensive means of production (through the EU ETS), transportation, and residential use of energy.

Carbon pricing

Sweden has a more ambitious target than the official commitments accepted under the European burden sharing agreement, which only account for one third of emissions, and requires an emission reduction of 17% outside the European Emission Trading Scheme (EU ETS). Sweden is committed to reducing the remaining two thirds of emissions in the sectors not covered by the EU ETS by 40% in 2020 from 1990 levels and to increase the share of renewable energy to 50% by the same year.

The EU ETS covers the energy sector and energy-intensive industry installations, while the major remaining sectors to which the specific Swedish target applies include: transportation, agriculture, residential housing, services, waste disposal, forestry, and aquaculture. The target includes non-CO₂ gases such as methane, nitrous oxide and F-gases. Most emissions originate in the energy, industry and transportation sectors.  Overall projections of avoided emissions due to introduced policy measures in the energy, transportation, industry, agriculture and waste sectors since 1990 indicate a total of 30-35m tonnes CO₂ will be avoided annually between 2010 and 2020 compared to business-as-usual scenarios which project emissions of about 95-100 MtCO₂e per year for 2010-2020. Most emission reductions in the non-ETS covered sectors are a result of the energy and CO₂ taxes.

In 1991, as a component of broad tax reforms, Sweden enacted a carbon tax on coal, oil, natural gas, petrol, and aviation fuel used in domestic travel. This new carbon tax complemented existing energy taxes; however, the 1991 tax reform did simultaneously lower the existent energy tax by 50%.

Initially set at USD100 per ton of CO₂ the carbon tax was eventually raised to USD150 per tonne, allowing Sweden to cut its carbon pollution by 9% between 1990 and 2006. Calculated on the basis of a fuel’s fossil carbon content, the tax is charged at a volumetric rate. Both peat and biofuels are exempt from the tax, as well as fuels used for electricity production.

Until 2015, minor tax relief was granted for natural gas and liquefied petroleum gas (LPG) used in cars, ships, and aircraft; however, from 2015 the same level of tax will apply to all fossil fuels. Additionally, EU ETS exempt industries such as agriculture, forestry and pisciculture are subject to a CO₂ tax that is 30% of the standard CO₂ tax.

Transportation

Sweden predominantly addresses emission growth in the transportation sector via market-based instruments, especially tax increases that reduce demand and encourage more energy- and fuel-efficient vehicles. Sweden implemented the European Biofuels Directive and the European Renewable Energy Directive, thus moving from the indicative 5.75% target for biofuels to a mandatory target of 10% renewable energy sources in transportation.

Sweden links tax incentives to the fuel efficiency of vehicles and their overall climate performance. The biofuels strategy included a temporary exemption for all vehicle biofuels until 2013 from the energy and carbon tax, while at the same time requiring that larger filling stations must sell at least one fuel containing biofuels. This was also linked to the green-car rebate introduced in 2007 that encourages the purchase of vehicles running on biogas or E85, hybrid-electric cars and fuel-efficient vehicles emitting less than 120g CO₂/km. The annual vehicle tax for passenger cars is differentiated based on CO₂ emissions. Furthermore, the energy efficiency of the car fleet improved due to the higher proportion of vehicles with diesel engines. These measures are expected to avoid emissions from transportation of 5.4m tonnes CO₂ by 2020 from 1990 levels as compared to business-as-usual scenarios.

REDD+ and LULUCF

Sweden has a large stock of forests that serve as carbon sinks. About 70% of the area is covered with forests that are predominantly privately owned (77%). The forest area accounts for 28.4m ha, of which 4.4m ha are protected. The land use, land-use change and forestry sector accounted for a net sink of 21-36m tonnes of CO₂ over the period from 1990 until 2007. More recently, the sink was reduced by severe storms that brought down a large quantity of forests and increased logging activities. The use of biofuels from wood products has increased from 40TWh to 100TWh since 1990, which also contributed to a reduction of the carbon sink and partly counteracted the biofuels-based emission reductions in the transportation sector. 

Adaptation

Sweden’s Sixth National Communication identifies the following sectors as at risk from climate change related temperature fluctuations and altered precipitation patterns: infrastructure, communications, drinking water supply, agriculture, forestry, fisheries, and tourism.

There is no central agency responsible for climate change adaptation measures; rather climate change adaptation is spread across different specialised government agencies including: the Swedish National Board of Housing, Building, and Planning, the Swedish Meteorological and Hydrological Institute (SMHI); and the Swedish Civil Contingencies Agency.

Sweden has actively put adaptation measures in place to address the expected adverse effects of climate change. The SMHI disseminates continuously updated climate change scenarios and indicators via its platform on www.smhi.se and in 2012 launched a heatwave warning system. A number of government agencies, including the National Veterinary Institute, National Board of Health and Welfare, Swedish Institute for Communicable Disease and Control, Swedish Board of Agriculture, and National Food Agency, have collaborated on research regarding climate change impacts and infectious diseases, as well as organizational readiness. In regards to infrastructure, since Sweden experienced significant storms in 2005 and 2007, the nation has works to replace overhead power lines with underground wires.

The implementation of adaptation measures largely falls within the remit of the municipalities, which are responsible for contingency planning, emergency services, technical supplies and overall public planning. Recent extreme weather events motivated investments in pumping systems to address flooding and raise minimum standards for construction. The Planning and Building Act (2008) was amended to prevent new buildings from being erected in unsuitable locations.  It requires taking into account the risks associated with flooding, erosion and accidents in municipal comprehensive and detailed development plans. It requires risk assessments and the formulation of adaptation strategies in the public infrastructure sector, particularly concerning the rail networks and roads. Storms pose risks to the energy sector, which is required to analyse its risk exposure to extreme weather events and address its vulnerabilities, for example by replacing overhead power lines with buried cables for electricity distribution. Adaptation is also addressed in the Budget Bill (Autumn 2008) and the Climate and Energy Bill (2009). In the period of 2009-2011, SEK400m (USD54.2m) were earmarked for adaptation measures.

Sweden’s climate change research focuses on climate processes and climate modelling to develop regional scenarios that form the basis of adaptation plans, as well as measures on co-benefits for climate mitigation and sectoral policies. Studies are undertaken on changes in water resources and forests as well as the effects of climate change-related effects on ecosystems. Social science research ranges from energy systems to research on climate policy processes and planning tools for adaptation to the impact on biodiversity and land use. Swedish research institutions are involved in numerous international research co-operations with European partners and institutions in developing countries alike, where the focus is on environmental technologies, climate-related agricultural research and environmental policy.